Mapping a Digital Path from the Perspective of a Tech CFO.
Imagine it’s your life-long dream to own an exact replica of the DeLorean from “Back to the Future” with modern tech features. If you’re going to build a futuristic car, why not do it with some style?
You meet with a large custom car dealer, who sells you on a better concept that will “transform everything.” Dizzied by the promise of transformation, you commit, and write the biggest check of your life.
The car dealer calls their affiliate office in Asia, and says, “here’s a new project. Get to work.”
Four months go by without an update. Enough time for you to wonder, and sweat. One day, the dealer calls a progress meeting, claiming they’re ahead of schedule. You boil with excitement to see progress on the DeLorean. The dealer unveils a lawn mower, and says, “Look at the functionality. It can cut grass.”
To which you reply, “That’s not what I wanted.”
An all-to familiar story in IT
Half of all IT projects fail. At least that’s what Shannon Florentine is saying in the aptly named article, More than Half of IT Projects Still Failing by CIO.com, and it occurs more frequently than in the past.
The hand-offs, the lack of communication, the disjointed processes, the disappointment, the money gone.
This is what you go through when IT projects fail.
Worse yet, you are now way behind on your deployment, and a hyper competitive world is catching up, or has moved past you.
The T word, if you haven't already guessed, is "transformation."
The notion of transformation involves modernizing systems and implementing cloud-based, mobile, and other technologies. Sounds promising, right?
There are many who misinterpret transformation as occurring in one fell swoop. Instead of taking steps towards the future, the future gets dumped on your lap in the form of a huge system or process that will take years to customize while operations go unchanged. Here are three ways to systematically upgrade your tech before pouring a ton of money into full system replacements.
- Collaborate more
- Iterate and adapt
- Align IT goals with the business
It’s time to rethink transformation. As executives, we know we have to prepare for the future, and that a combination of technologies can help get us there. Beyond that, we do not always have a clear picture of how to navigate our way as a unit.
Putting on my CFO hat, I ask, What's the compelling reason to spend millions of dollars on one massive project if there’s a 50% chance of it failing? What’s the return? How are we transitioning, and how are we making decisions?
Collaborating with the entire executive team, we find success in rallying around an objective:
Why transform if you can do something with the current system iteratively, and realize our goals faster - and cheaper (while modernizing the system in the process)?
With that mind, we collaborate to make decisions that align with the business, with our tech goals, and with each other.
What if no IT project failed?
What if, during the course of a project, leadership teams can see that the path is not aligned with their original vision (or that vision has changed) and they steer the project back on track?
With iterative deployment, the business is seeing results sooner, so they can actually get feedback sooner, and stay on course.
Ferdinand Magellan didn’t stick his index finger in his mouth, point at the sky, and feel the breeze in his quest to first circumnavigate the globe. He charted a course, making corrections based on weather and currents – avoiding Krakens along the way.
You get feedback with iterative deployment. It's out there in the user community and they start telling you what works and what doesn't work. For a new product, that feedback is driven by user data and revenue. With operations, the data comes in the form of efficiency gains and lowered costs.
An Example in Retaining Value
A pharmaceutical company was looking to make a change to a mission-critical application, which was built 15 years ago. They had two options.
- Replace the system, a massive undertaking that would take years to accomplish.
- Unleash the data hounds, identify inefficiencies in the system, and improve them while updating the technology along the way.
The company wisely chose option two, a path that delivered constant value. The vendor they hired modularized system inefficiencies, which could be addressed individually in newer technologies.
With a data-backed plan, the pharmaceutical company's IT team (and their partner) delivered transformation faster than a massive rebuild and drove iterative ROI during the process that could be passed on to the consumer, drop to the bottom line, or both.
The result of an iterative approach is a self-funding transformation that mitigates the risks of losing money and not having the right system. Iterative modernization is saving, or earning, big companies tens of millions of dollars every year.
Decisions that Align with the Business
It's tough to bet on a two-year wait.
From the CFO perspective, making course corrections along the way and deploying some more capital as needed, is the smart way to maintain an iterative process. Decisions come from, and are validated by, feedback loop data.
For years, Google's view was that "we never leave beta." There's no such thing as a finished project anymore. Separating large transformative projects into smaller bites and iterating along the way is the most effective way to transform, drive ROI, and stay ahead of the competition.
When you ask for a car, collaborate during the course of the project, iterate, and make aligned decisions, you get a car.
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